US Congress, keep the US Export-Import-Bank open, you’ve got much more serious credit distortions to fight.

Sir, with respect to the US closing Exim Bank you write about “the economic equivalent of unilateral disarmament in a world bristling with nuclear weapons” as if the one disarming was doing what’s immoral, “The wobbly economic leadership from America” April 25.

You write “In the past two years, Chinese development banks have lent $670bn in subsidized credit in subsidized credit to help domestic companies win bids all over the world… more than all Exim guarantees since set up in the 30s” and still you argue that Exim-Bank could serve “as a check on crony capitalism practiced by China and others? 

And you write “No private sector bank will finance 15 year emerging market projects” Of course not, why should they when they are allowed to hold less equity when lending to already emerged markets perceived as safer?

Would I close Exim-Bank? No, I have been able to use it very satisfactorily during my life, so that would be something extremely ungrateful of me. But, that said, much more important than keeping it open, is to get rid of the credit-risk differentiated equity requirements for banks, those which distort immensely the allocation of bank credit all around the world. The Basel Committee, that’s what the US Congress should really be working to close down, or at least forbidding it to discriminate between borrowers.

@PerKurowski